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Flash PMI points to improving US growth, but supply shocks loom
The July flash survey showed a return to hiring and stronger services, while manufacturing growth softened as supply chain delays and price pressures intensified.
Forexlive said US businesses had a “good start” to the third quarter based on the latest flash PMI survey, with the data broadly consistent with GDP growth accelerating to an annualized 2.0% after a 1.2% pace in the second quarter.
The survey pointed to an encouraging return to hiring, with employment rising for the first time in three months. It also showed services strengthened in July, while flash manufacturing came in below expectations and at a four month low, remaining above 50.
Forexlive cautioned that some hiring gains could be short-lived, noting July demand may have been boosted by hospitality spending tied to the FIFA World Cup and USA 250 anniversary activities.
The outlet also highlighted a worsening picture for growth drivers, citing intensifying supply chain delays and a renewed upturn in price pressures. It added that recent events in the Middle East may have further strained supply chains and raised downside risks for the near term outlook.